Wednesday, July 16, 2008

Tracking a Strong Stock Market

I recently showed what the distribution of the NYSE TICK looks like on a very weak day. Wednesday gave us an opportunity to see how the TICK behaves on an especially strong day. The blue line represents a five-period moving average, and we're looking at how the line behaves relative to the horizontal pink, zero line (scale for the moving average of TICK is at left). We can see the rising slope of the moving average line and the way in which the line stayed above zero throughout late morning and all afternoon. Add to that the strength in the leading themes we've been tracking, as noted in the morning Twitter post, and it made for an excellent trading day.

About Me

Author of The Psychology of Trading (Wiley, 2003), Enhancing Trader Performance (Wiley, 2006), and The Daily Trading Coach (Wiley, 2009) with an interest in using historical patterns in markets to find a trading edge. I am also interested in performance enhancement among traders, drawing upon research from expert performers in various fields. I took a leave from blogging starting May, 2010 due to my role at a global macro hedge fund. Blogging resumed in February, 2014, along with regular posting to Twitter and StockTwits (@steenbab).